The Role of CFOs in Crisis Management
The Chief Financial Officer plays an indispensable role in steering your company through crises and contingencies. As we continue to work in the midst of the COVID-19 pandemic, we take a look at how CFOs can lead their companies through the current crisis.
1. Optimizing Cash Reserves and Liquidity
Given that there is no end in sight yet to this pandemic, it is important for businesses to remain solvent and access additional resources when needed. CFOs work in optimizing the company’s cash reserves and ensuring that emergency resources remain accessible.
2. Scenario Development
The CFO works together with analysts and the rest of the organization to identify the effects of the pandemic on their processes. The CFO then leads the development of frameworks that can help the company’s management make decisions that will result in specific scenarios.
This will help monitor how decisions affect the company’s ability to survive an impending economic downturn.
3. Crisis Management
It is critical for CFOs to take the lead in communicating the company’s financial health with the Board of Directors and investors.
It is also important for CFOs to share new information that may impact the company and reassure the stakeholders that the management is taking control of the situation even as it develops.
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